- Hi, I'm Jim Stice.
I'm a Professor of Accounting at Brigham Young University.
This is my brother Kay.
- I am also a Professor of Accounting
at Brigham Young University.
- We've been teaching accounting for a combined total
of over 70 years.
- In this course we'll introduce you to
the bookkeeping process that underlies the production
of a company's accounting data.
Now these accounting data are ultimately used both
within a company to make operating decisions
and outside of companies
to make investing and lending decisions.
- [Jim] You're going to learn about
the famous debit and credit system.
- [Kay] You're going to see how the simple procedures
of transaction analysis, journal entries, and posting
can organize the data that come into businesses every day,
from small businesses operated by individual entrepreneurs
to huge multinational businesses with operations
around the world.
- Consider the information needs of a company
such as McDonalds, launched by Ray Kroc back in 1954.
- [Kay] Now the essence of McDonald's business seems simple.
Revenues come from selling Big Macs, Happy Meals,
Chicken McNuggets and the like.
- [Jim] Operating costs include the costs
of the raw materials to produce the food items,
labor costs, building rentals, income taxes, and so forth.
- But the magnitude of McDonald's operation
makes compiling reliable information a challenge.
Now think in terms of volume.
With system wide sales averaging almost
300 million dollars a day.
And geography, with locations in 120 countries
throughout the world.
- So, how are these millions of customers
and supplier transactions summarized
and eventually reported as useful information
in the financial statements?
- [Kay] Well, this transformation process is called
the Accounting Cycle.
That's the bookkeeping part of accounting.
- Now, you may have heard of debits and credits
and journal entries and trial balances.
Well in this course, we're going to take the mystery
out of these and other terms.
- We will show you how transactions
turn into financial statements.
We'll show you how accounting systems are designed
to aggregate mountains of financial information
and turn that information into something that can be used
by decision makers.
- Now, don't be nervous.
We've designed this bookkeeping course to be self contained
and we carefully explain any terminology that we use.
- In short, this is an introductory course
with no prior accounting knowledge necessary.
- So, are you ready to go?
Let's get started.